PTAB Turbulence: A Good Time to Be a Patent Owner

In this week’s episode of IPWatchdog Unleashed, we dive into the intricacies of patent enforcement with Scott McKeown, a partner with Wolf Greenfield and author of PatentsPostGrant.com. McKeown, who has a reputation as one of America’s top practitioners at the Patent Trial and Appeal Board (PTAB), shares insights into the continually evolving landscape of patents, patent litigation, PTAB challenges and regulatory upheaval at the United States Patent and Trademark Office (USPTO). We specifically discuss the biggest issues facing the USPTO generally, and the PTAB specifically, namely the increase in discretionary denials under the Trump Administration, the fact that across all aspects of government it seems we are governing by memorandum, how what we are seeing at the USPTO now is a snap back from the past several years but can’t be expected to last forever, the demise of the patent examiners union, and more.

At the end of our conversation McKeown’s final thoughts are a message of hope for patent owners and a message to implementers that they need to stay the course and prepare to pay more when sued.  “If you’re asserting patents, it’s a great time” because “the PTAB has been beaten down,” McKeown concluded. He also wryly punctuated his analysis by saying that alleged infringers should probably “invest in some hotels in Texas because it’s going to be the Wild West down there for a couple years.”

A Political PTAB Tango: Navigating People & Policies

Our conversation begins with the impact of political shifts on patent policies in the United States. McKeown highlights how each change in administration, from Democrat to Republican, brings a wave of policy rollbacks followed by an array of new, often radical changes. This cyclical nature fosters a climate of uncertainty and inconsistency, which he explains is not helpful for USPTO employees, practitioners, and the individuals and companies that use and rely on the Patent Office. For McKeown, this political interplay is akin to a high-stakes chess match, where strategies and rules change with the political winds and lead whoever comes in next to have to work ever harder to implement their vision, which is leading to large swings in policy and implementation.

The turmoil isn’t confined to the PTAB realm, according to McKeown. There’s a broader demoralization within the Patent Office, partly due to the elimination of the patent examiners’ union and the return-to-work requirements, which has already caused a significant brain drain and which will almost certainly continue. This upheaval isn’t just political; it directly impacts the quality of patent examinations and, subsequently, the validity of patents themselves.

Settled Expectations vs. Reality

A key theme in our conversation is the notion of “settled expectations” for patent owners, which is one of the key new requirements being used by the Office to deny the institution of inter partes review (IPR) challenges at the PTAB. According to McKeown, the complexity arises when balancing the rights to maintain patents against ensuring they don’t unjustly burden taxpayers by removing valuable innovations from the public domain. And, McKeown explained that settled expectations at the PTAB really needs to be about more than just the length of time a patent has gone unchallenged. Often with the creative ways claim scope is interpreted by patent owners, McKeown explains there can be no reason to expect a patent would or should be enforced against a particular implementer.

McKeown acknowledges the simple allure of settled expectations being a consideration: “The government shouldn’t give you something, and then a couple years later, after you build a business around it, take it back.” And he is not philosophically opposed to settled expectations playing a role, he just doubts that a balance will be achievable that takes into consideration the numerous factors that should influence whether a patent owner truly could reasonably expect the patent would not be challenged moving forward.

A Push for Systemic Change

One proposed solution we discuss is a possible new legislative framework, such as implementing a two-tier patent system like some other countries, where less stringent examination is applied to certain patents that often will have a shorter term, and deeper examinations are applied to patents that reach a certain economic threshold, significance, that will be litigated, or for whatever reason where the patent applicant wants to go through a full-blown examination to establish stronger rights.

This led us to explore possible innovative approaches to addressing patent quality and backlog issues, including a bifurcated examination process focused initially on novelty, followed by optional, more comprehensive examinations if and when necessary. This could ease the current examination backlog and lead to faster patent approvals even if there are further losses in the examiner ranks. It would also allow for resources to be placed where they matter the most, which is with the most significant and strict examination being reserved for those patents that are the most valuable.

Adapt and Get Ready to Go to Texas

Though the current patent landscape presents daunting challenges, McKeown imparts a message of resilience. For patent owners, the time is ripe to assert rights owing to favorable conditions for patent owners at the Office. For defendants, strategic adaptability remains key, and budgeting for the likely increasing litigation risks seems prudent. It is also reasonable to assume courts in Texas will become more active than in recent years.

More IPWatchdog Unleashed

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